Private Foundation Assets Are Not Public Dollars
A new study defends the limited relationship between philanthropy and government
WASHINGTON, June 18 /PRNewswire-USNewswire/ — Tomorrow, The Philanthropy Roundtable releases a new report on charitable giving and the government’s relationship with foundations and charities. The report, How Public Is Private Philanthropy? Separating Reality from Myth, is a comprehensive legal analysis that examines the claim that charitable funds are “public money” because they are exempt from federal taxes, receive state charters, and are subject to oversight by state attorneys general.
The co-authors of this report are prominent scholars Evelyn Brody, Professor at the Chicago-Kent College of Law, and John Tyler, Secretary and General Counsel of the Ewing Marion Kauffman Foundation. They conclude, based on numerous applicable legal precedents, that the public-money assertion is not well grounded.
Brody and Tyler demonstrate that it is deeply problematic to consider the federal tax exemption and the charitable tax deduction subsidies to charities, and even more problematic to assert that the public has a legitimate claim to private philanthropic assets. Individuals and businesses routinely receive tax preferences, the authors note, but they are never considered governmental entities nor are their assets considered public property.
The law treats foundations like private entities devoted to public ends, but they do not have to serve the government’s purposes nor those of the public at large. Similarly, a charter from the state does not make foundations and other charities public entities. Policymakers cannot use these arguments to intrude into the governance, missions, and operations of philanthropies.
Traditionally, there has been a limited relationship between philanthropy and government. In recent years, the “public money” claim has been employed to support proposals to urge stricter legal limits on the operations and governance of foundations and other charities. This report underscores the legal basis for continued separation between government and philanthropy.
“American philanthropy is the envy of the world, with charitable giving last year at over $307 billion,” said Adam Meyerson, President of The Philanthropy Roundtable. “But it’s under attack by activists, legislators, and policymakers who clamor for greater governmental authority to regulate the activities of American philanthropists.”
The report will be released on Friday, June 19, 2009, during a panel discussion hosted by the Hudson Institute’s Bradley Center for Philanthropy and Civic Renewal in Washington, D.C.
For more information on The Philanthropy Roundtable and this report visit www.philanthropyroundtable.org.
Contact: Sue Santa
publicpolicy@philanthropyroundtable.org
202-822-8333
SOURCE The Philanthropy Roundtable